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Greek coalition parties renew support for gov't
Last Updated(Beijing Time):2012-01-20 08:11

Greek Prime Minister Lucas Papademos on Thursday won the renewed support of leaders of the three parties backing his interim government over the ongoing crucial talks regarding the Greek debt restructuring and a second international bailout loans package.

"The dialogue was conducted in a very positive climate and the political leaders renewed their full support of the government to complete its tasks," said Papademos after a meeting with Socialist PASOK party leader and former Premier George Papandreou, conservative New Democracy President Antonis Samaras and rightist Popular Orthodox Rally head George Karatzaferis.

The meeting was held shortly before Papademos resumed deliberations over the terms of the 50 percent "haircut" of the Greek debt with visiting Institute of International Finance (IIF) Managing Director Charles Dallara representing private banks and hedge funds holding Greek bonds on Thursday evening.

A new round of talks between the two sides opened on Wednesday in Athens, following the suspension of negotiations last week over the interest rate of the new bonds with longer maturities Greece will offer to the private sector.

The rate will determine the extent of the actual losses banks and investment funds will suffer, fuelling worries that some bondholders might not support the agreement and international credit rating agencies could regard the result as a default.

As the time is pressing for an immediate agreement in time to stave off a Greek default in March, both sides have expressed hope that a positive outcome could come within days.

Without a deal on the PSI, the vital second rescue package to Greece will be put in doubt, Greek Finance Minister Evangelos Venizelos warned once again on Thursday, addressing the parliament during a debate on an omnibus bill containing key reforms such as the liberalization of dozens closed professions and markets.

"This is a moment of truth," Venizelos said that an agreement should be better clinched by Monday's meeting of eurozone Finance ministers.

He stressed that eurozone countries will not further support Greece without a bond swap deal, a development that would lead to a default and a Greek exit from the European common currency zone.

Without the multi-billion euro aid, Greece will not be able to meet its financial obligations as early as coming March.

Greece has been kept afloat since May 2010 with multi-billion euro bailout loans granted by European counterparts and International Monetary Fund (IMF) in exchange of a harsh austerity and reform drive aiming to slash deficits and restore growth.

Senior EU/IMF auditors are expected in Athens Friday to launch talks with Greek officials on the detailed terms of the second rescue package and reforms to be carried out in following months, adding pressure to the government to accelerate the pace.

 

 

Source:Xinhua 
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